GlobalData plc

11/26/2020 | Press release | Distributed by Public on 11/26/2020 04:47

Trade deal with the EU would lift UK automotive sector investment in 2021

26 Nov 2020
Trade deal with the EU would lift UK automotive sector investment in 2021

Posted in Automotive

Following the news that UK car production in October was down by 18% on last year, according to data released by the SMMT;

David Leggett, Automotive Analyst at GlobalData, a leading data and analytics company, offers his view:

'COVID-19 has battered the UK car manufacturing sector, with output so far this year is down by a third on 2019's level. The value of lost UK car output this year is over GBP10bn.

'The UK automotive sector faces uncertain prospects for 2021. Top of the list of concerns is the need for a UK-EU trade deal that avoids tariffs on UK-EU shipments of vehicles and parts.

'Such a headwind would damage the UK auto industry's competitive position just as it contemplates a recovery from the unprecedented drop to volumes this year caused by the pandemic.

'Moreover, the UK auto industry is competing with other nations for vital investment in emerging high-growth advanced technologies such as electrification and automated drive.

'A trade deal with the EU would help to lift confidence and boost investment in UK manufacturing in 2021. Many investment projects put on hold by future EU-UK trading rules uncertainty would get the go-ahead.

'However, a 10% no-deal WTO tariff would add an average GBP2,000 to the price tag of UK-built electric cars sold in the EU, seriously undermining the UK's future investment case.'